Since I’ve started at my new job, I have looked at a number of mobile products and services. While I’ve had some amusing meetings where entrepreneurs show me their hot new “mobile marketing” concept that’s essentially crude, circa-2003 SMS/WAP Push, the more interesting conversations relate to the current and future role of the mobile operators, or carriers, in the mobile content and commerce equation.
I can’t tell you how many times I’ve been asked: how long will it be before the carriers are inevitably relegated to “dumb pipe” status and the mobile internet opens up like the wired internet? How long until we can safely route around the carrier? My answer – “a long time, or never, unless we see a disruptive technology replace cellular” – always confuses people. How could it not happen in the next 12-18 months?
This is, unfortunately, a major blind spot of the web-centric — a blind spot that has worked to my advantage in the past. For example, at JAMDAT we supported BREW even though it was “closed” and built a great business; meanwhile the “open” Java Community Process for J2ME failed to produce a competitive offering in a timely manner. Sure, J2ME ended up being an important and widely adopted technology, but avoiding BREW because it was not “open” was a stupid business decision that my competitors came to regret.
Shawn Conahan, the CEO of InterCasting, summarized it pretty well:
… I talked to a VC who said he would not invest in any company that includes “working with wireless carriers” in its pitch. Worse in my opinion would be investing in any company that includes “going around the wireless carriers” in its pitch. While the former is a difficult path, the latter practically ensures failure.
Shawn’s point is completely lost on many venture capitalists in the Valley, who don’t understand the need to create symbiotic businesses in mobile. They are so intent on creating disruption, they miss the forest for the trees.
It’s not going to win me any popularity contests here, but I would argue that the mobile business may be more a model for the future of the internet than vice versa. Look at MySpace/Photobucket, or Windows Live, or Facebook, and you’ll see access platforms asserting their supremacy in the value chain … just like the big, bad mobile carriers.